Dealing with Variability

What’s possible:

This sounds counter-intuitive, but if a production system is built correctly it can absorb high levels of variability without allowing the variability to disrupt delivery.

This is what the Theory of Constraints approach to production does. We put a system in place that typically has a shorter lead time than Lean-kanban, less WIP than Lean-kanban, yet “absorbs” variability of all types to provide extremely high on-time performance (98% or better, and we prefer 99% or better).

You know, “Murphy” is alive and well in most organizations. Rather than building a system that means the people have to play whack-a-mole every time there’s any kind of a “blip” in circumstances, we build a system that is almost immune to Murphy-strikes. Murphy does its worst and we still hit 99% or better on-time performance in a fast lead time with superb quality and no expediting.

Does this mean we tolerate variability?
No. We want to systematically reduce it or even eliminate it. But first, we make our due-date performance immune to Murphy’s attempts to do harm. Then we can attack variability with impunity.

There is a manufacturer in Vancouver that manufactures a high-tech product. The lead time on materials is too long and subject to great variability. There are constantly new products being introduced; and engineering changes to the existing products. Sales are highly volatile, variable in total demand and in timing and in product mix. Now, add to this that the company’s sales have been GROWING by more than $5 MM PER MONTH for several years, with all the implications on people and machine capacity, on plant layout, on everything … then be astonished to learn that for YEARS with the TOC in place, their on-time performance has been 99.85% while they have turned over their inventories at an astonishingly high rate.

Help Us Make This Workshop Happen Fri 15th June 2018

Combining Theory Of Constraints (TOC) and Lean provides very fast, very large performance improvements that just keep getting better -- and ALWAYS reach the bottom line.

Steve Jackson teams-up with Derek Barichievy - but only if we can get 10 people to commit immediately! If we can ... it's a "go."
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What Clients Say

“Without exception, their approach to working relationships was professional, respectful, cordial and positive. They inspired our staff to develop strong teamwork bonds, always generating enthusiasm and respect from the groups they worked with. The business and personal integrity of both Steve and Rod is unimpeachable. They demonstrated honesty, dedication to their mission – if they ever felt that they had failed to convey a principle, or clarify a process, they would do double duty, on their own account, to elucidate, explain and discuss, ensuring that understanding was achieved.”

-- Sr.Vice President, Pharmaceuticals manufacturing & packaging

“A year earlier we had done $1.6 to $1.7 million in sales for a month and there was overtime, Saturday work and stress. This time, when the company reached the $2 million mark in monthly sales the plant didn’t even realize that the company was having that busy of a month until the results were announced.
There were no ill effects, no overtime, and inventory also dropped. With the restructuring of processes (using TOC) sales not only grew but became more profitable.”

-- Owner and President, Kitchen Cabinet company

“I can tell you that in the Fall, with relatively little increase in headcount and using exactly the same equipment, we were able to record 60% more revenue than in our previous best-ever Fall – which, at the time, we thought was close to the plant’s maximum production.”

-- Owner & GM, furniture manufacturing

“Your work with us … has resulted in a significant increase in volume. We have improved from a daily average of 189 tons to a daily average of 237 tons in the past 3 months … this is “found” capacity that we now fill with the orders we were previously turning away. Additionally we did not change any of the crewing levels and did not have to spend any capital.”

VP Ops, steel-related industry

“The first year after Theory of Constraints with 1 employee our gross sales grew 66%. This second year – safe to predict a 20-30% gross sales increase over last year, still only 1 employee and some part time help. Our cash flow has soared, we have eliminated the need for an operating line of credit, the company has cash in savings, cash in checking, and has for almost 12 months now. Clean shop, good jobs, cash in hand, bills paid, happy employee, happy wife, all because I took a chance to change my thinking!”